CONSUMER DISPUTES REDRESSAL FORUM, KOTTAYAM
Present
Sri. Santhosh Kesavanath P. President
Smt. Bindhu M. Thomas, Member
Sri. K.N. Radhakrishnan, Member
CC No. 77/2010
Monday, the 23rd day of April, 2012
Petitioner : Saneesh Kumar. S.S
Managing Partner
M/s. Babu’s Medicals,
Kanjikuzhy, Kottayam
Residing at Santhosh Bhavan,
Muttambalam P.O.,
Kottayam.
(By Adv. P.V Joseph)
Vs.
Opposite parties : 1) IFFCO Tokio General Insurance
Co. Ltd., Regd. Office:IFFCO
Sadan CI Dist, Centre, Saket,
New Delhi – 110 017.
2) Branch Manager,
IFFCO-TOKIO General Insurance Co. Ltd., XL/1485,
First Floor, Satgamaya,
M.G Road, Cochin – 682 011.
(BY Adv. Agi Joseph)
O R D E R
Sri. Santhosh Kesavanath P., President.
Case of the petitioner filed on 25..03..2010 is as follows.
Petitioner is the managing partner of M/s. Babu’s Medicals and petitioner’s wife Smitha Sahadevan being its partner. Medical shop business has been duly insured with opposite party for an amount of Rs. 10,00,000/-, as per Trade protector policy No. 47075981. Policy of petitioner is valid from 2..7..2007 to 1..7..2008. Medical shop business conducted is a self employment, as a means of livelihood, of family members of petitioner. On 26..4..2008 around mid night a fire occurred on the business premises of the petitioner and there by medical shop of petitioner was totally damaged.
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Due to fire building along with adjusant four other shop rooms and stock in trade, together with the fixtures, furniture, equipments including electronic and electrical gadgets totally destroyed. Petitioner quantified the damages to Rs. 852398/-. Since the shop was validly insured with opposite party, petitioner preferred a claim to opposite party. Surveyor cum loss assessor of the opposite party conducted investigation and submitted a report to the opposite party. Opposite party, even after in ordinate delay, after receipt of the lawyers notice issued by the petitioner, offered a settlement for Rs. 456661/- as full and final settlement. Opposite party further intimated the petitioner that settlement amount will be payable through DD in favour of M/s. Mini Muthoot. Petitioner objected releasing of settled claim. According to the petitioner act of the opposite party in not settling the claim in proper time and offering a meager amount of claim to petitioner amounts to deficiency in service. So, he prays for direction to the petitioner to pay Rs. 852398/-, being actual loss, with 10% interest from 10..6..2008 till realization. Opposite party claims Rs. 50,000/- as compensation and cost of the proceedings.
Opposite party entered appearance and filed version contenting that petition is not maintainable. According to opposite party liability of company is only as per terms and condition and exceptions of policy. Income from shop is not the sole means of livelihood of the petitioner. Medical shop is in the name of Smitha Sahadevan . In the drug license she is the proprietrix. Policy has taken suppressing this fact so, policy is void. Petitioner has no right to file a petition on behalf of Babu medicals. There
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was no stock of medicine worth Rs. 6,77,238/-. In the policy issued to the petitioner there is no lien / hypothecation endorsed in favour of Mini Muthoot, Kottayam branch. So, claim can be settled only through them. Further non-objection certificate is highly necessary. Since no NOC is produced by the petitioner opposite party could not honour the claim. Surveyor assessed the loss only for Rs. 456661/-. So the opposite party offered this amount as full and final settlement. Petitioner has taken 2 policies for the same premises one from National Insurance Company and the other from e opposite party. So opposite party is not liable to pay any compensation to petitioner. Since there are two policies in existence opposite party is only liable to pay ratable proportion of compensation so opposite party offered Rs. 4,56,661/-. According to opposite party statutory surveyor assessed the liability of opposite party and they are is only liable to
pay that much amount. Opposite party prays for dismissal of petition with their costs.
Points for determinations are:
i) Whether there is deficiency in service on the part of the opposite party?
ii) Relief and costs?
Evidence in this case consists of affidavit filed by both parties and Ext. A1 to A13 documents on the side of the petitioner and Ext. B1 to B6 documents on the side of the opposite party.
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Point No. 1
Crux of the case of the petitioner is that act of opposite party in offering an amount of Rs. 4,56,661/- for a loss of Rs. 8,52,398/-sustained to the petitioner, as a result of fire, amounts to deficiency in service.
According to the opposite party there is no deficiency in service on the part of opposite party. Learned counsel for opposite party vehumently argued that petitioner has no locus standi for filing this petition. Surveyor appointed as per TAC has the right for calculating the damages on the basis of conditions of the policy. Since there is double insurance, average clause principle is applicable. Since a lien is marked opposite party can pay the amount only through the person who has the lien.
The first question to be decided is whether petitioner has any locus standi for filing this petition. According to the opposite party petitioner has no insurable interest over the subject matter covered under the insurance policy. Petitioner produced copy of the trade protector policy said document is marked as Ext. A1. From Ext. A1 it can be seen that insurance coverage is for the shop M/s. Babu Medicals. Here the complainant is admittedly the managing partner. He himself submitted the proposal form and opposite party without any protest accepted the offer and issued the policy. So, in our view the contention raised by opposite party that petitioner has no insurable interest is not sustainable.
The next question to be decided is whether assessment made by the surveyor is acceptable or not. Surveyor’s report produced by the opposite party is marked as Ext. B5. As per Ext. B5 surveyor assessed the loss as Rs. 5,46,661/-. Counsel for opposite party argued that the surveyor appointed by the opposite party company is a statutory surveyor and also as per regulation 13 of insurance (surveyors and loss
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assessors) regulations 2000. It is the duty and right of surveyor to give a report. In our view it is true that as per the section 13 (4) of the said regulation the surveyor has the duty for examine, enquire, investigate, verify and check upon the causes and circumstances of loss in question including expenditure of loss, nature of owner ship, and insurable interest. As per regulation 13 (2) the loss assessor shall maintain confidentiality and nutrality without geo paradising the liability of the insurer on the claim of insured. Further more he has to take an extra opinion as per regulation 13(5) when required. According to the petitioner he has suffered a loss of Rs. 8,52,398/-. In Ext. B5 survey report it is stated that stock of medicine and non- medicine item is Rs. 1,08,180/-. From the purchase report the surveyor assessed the net loss as Rs. 6,77,328/-. In Ext. B5 the damage suffered by the petitioner is assessed as Rs. 8,52,398/-. In Ext. B5 report damage to glass counter and shelves is assessed as Rs. 18,719/- instead of Rs. 25,000/- being the insured value in the face of net damage at Rs. 38,813/-, after depreciation in our view is un reasonable and arbitrary. The surveyor found that the closing stock position as on 31..3..2008 as
Rs. 6,19,523/-.. On verification of the purchase bill invoice surveyor found that the total purchase from 1..4..2008 to 27..4..2008 came to Rs. 1,10,197/- and he took the average of 27 days sales at Rs. 85,735/-. There after taking one month sale he arbitrarily reduced Rs. 1,25,000/- from the stock position instead of Rs. 85,735/-.
In Ext. B5 report surveyor made ratable distribution of the liability between opposite party insurance company and national insurance company under Ext. B6 policy. In our view as per regulation 13 of Insurance Surveyors and Loss Assessors (Licensing, provisional requirement and code of contact) regulation 2001. Surveyor
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has no power for apportionment . In our view the apportionment made by the surveyor is beyond his power.
Counsel for the opposite party vehumently argued that as per section 64 if Insurance Act . TAC is to control and regulate the rates, advantage, terms and conditions that may be offered by the insurers in respect of general insurance business. In our view T.A.C has power and control to regulate the rates, advantages terms and conditions that may be offered by the insurers. But in this case in Ext. A1 policy of the opposite party there is no provision for ratable distribution or contribution in case of double insurance . But in Ext. B6 policy of national insurance company there is a condition as condition No. 6 with regard to contribution.
It reads as follows if at the time of loss or damage happening to any property here by insured their by any other subsisting insurance, or insurances whether effected by the insured or by any other person or persons covering the same property this company shall not be liable to pay or contribute more than its ratable proportion or such loss or damages . In the absence such a condition in the given policy petitioner can recover for full indemnity. Opposite party has no case that petitioner received any amount from the national insurance company. As per provisions of the contract act opposite party after discharging from liability can call upon national insurance company to contribute there share for the loss. So, in our view due to lack of condition in policy certificate opposite party can not do apportionment .
The next question to be decided is whether M/s. Mini Muthoot has any lien over the claim amount which the petitioner is entitled. opposite party has not produced any piece of paper to prove that M/s. Mini Muthoot has a lien on the insured amount. In the lack of evidence we are of the view that the contention of the
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petitioner that M/s. Mini Muthoot has a lien on the policy is not sustainable. In our view act of the opposite party in offering part of the claim, amounts to deficiency in service. As per sub clause 5 of clause 8 of IRDA (protection of policy holders interest regulation) 2001 upon acceptance of the offer of settlement by the insured the payment of amount shall be made within 7 days from the date of acceptance of the offer. In case of delay in payment the insurance company shall be liable to pay interest at the rate which is 2 % above the bank rate. So, point No. 1 is found accordingly. Since the surveyor assessed damage as Rs. 852398/- opposite party is liable to pay the same to the petitioner.
Point No. 2
In view of the finding in point No. 1, petition is allowed. In the result opposite party is ordered to pay the petitioner an amount of Rs. 8,52,398/- with 10% interest from 10..6..2008 till realization. On depositing the amount opposite party can claim the ratable proportion amount from the national insurance company if they desires So, since interest is allowed no separate compensation is ordered. Opposite party is ordered to pay an amount of Rs. 3,000/- as litigation cost to the petitioner.
Order shall be complied with within one month of receipt of a copy of this order.
Dictated by me transcribed by the Confidential Assistant corrected by me and
pronounced in the Open Forum on this the 23rd day of April, 2012.
Sri. Santhosh Kesavanath P. President Sd/-
Smt. Bindhu M. Thomas, Member Sd/-
Sri. K.N Radhakrishnan, Member Sd/-
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APPENDIX
Documents for the petitioner:
Ext. A1: Trade protector policy bearing No. 47075981.
Ext. A2: Copy of letter issued to the State Bank of Mysore Dtd: 31..3..2008
Ext. A3: Copy of Truck licence Dtd: 4..4..2003
Ext. A4: Copy of Chelan Dtd: 2..4..2008
Ext. A5: Partner ship deed
Ext. A6: Copy of FIR in 241/08
Ext. A7: Copy of report of fire force Dtd: 28..4..2008
Ext. A8series Copy of sales tax return for financial year 2007-08
Ext. A9series Copy of purchase bill invoice issued by wholesale suppliers.
Ext. A10: Copy of claim form
Ext. A11: Copy of lawyers notice
Ext. A11(a) Postal registration receipt
(b,c,d) Copy of AD Card
Ext. A12 Letter Dtd; 23.11..2009
Ext. A12series Working sheet and discharge voucher
Ext. A13: Letter Dtd: 4..12..2009
Documents for the opposite party:
Ext. B1: Copy of the policy condition
Ext. B2: Copy of drug license
Ext. B3: Letter Dtd: 22..10..2009
Ext. B4: Letter Dtd: 23..11..2009
Ext. B5: Surveyors report.
Ext. B6: Copy of policy issued from National Insurance Company.
By Order,
Senior Superintendent.
